Two well known players in the flash storage business are about to become one. In somewhat of a surprise move, SanDisk inked an agreement to acquire Fuision-io in a deal that's worth about $1.1 billion. It's an all-cash offer of $11.25 per share, which is about 21 percent higher than Fusion-io's closing price on June 13.

This is a big acquisition for SanDisk. The company is already an established player in the flash media space with its chips being found in smartphones, digital cameras, and various other mobile devices. SanDisk also uses its chips to market its own brand solid state drives (SSDs), including its Extreme PRO SSD introduced earlier this month.

Not only does SanDisk make its own SSDs, but it's seeing good margins. According to Reuters, SanDisk's revenue from SSDs hiked up 61 percent in the first quarter of this year, with its own brand SSD business accounting for more than a quarter -- 28 percent -- of overall revenue.

Fusion-io, on the other hand, has posted losses in each of its last five quarters. That may be why SanDisk was able to negotiate a price that was lower than some analysts and investors had anticipated. Despite the financials, there's a lot of upside to Fusion-io, which is heavily invested in the enterprise sector with high-speed solutions. It also has Apple co-founder Steve Wozniak serving as its Chief Scientist, a position he's held since December 2008.